Weekly Analysis: All Eyes on the FED as Cryptocurrencies Shoot for the Moon

Weekly Analysis: All Eyes on the FED as Cryptocurrencies Shoot for the Moon

Introduction

Mate Cser

Trader and financial analyst, with 10 years of experience in the field. An expert in technical analysis and risk management, but also an avid practitioner of value investment and passive strategies, with a passion towards anything that is connected to the market.

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Asset

Current Value

Weekly Change

S&P 500

2380

1.30%

DAX

12470

2.11%

WTI Crude Oil

49.19

-1.45%

GOLD

1269.50

-1.71%

Bitcoin

1332

9.34%

EUR/USD

1.0898

1.63%

5 Things to Watch Next Week

Will the FED shock the market?

The consensus among investors is that the FED won’t hike its benchmark rate next week, and the recent weakness in economic numbers makes that even more likely. That said, the central bank was upbeat in recent months, and a surprise rate hike is not out of the question. Stocks and gold could take a hit in the event of a hike, but a cautious monetary statement could propel a new swing higher in the Shiny Metal, and the major indices while pushing the Dollar even lower.

Will Cryptocurrencies keep rising?

The cryptocurrency market remained active this weekend after the week that brought huge moves for almost every major currency. As the mainstream investment world increasingly turns its attention to this segment, volatility is expected to remain elevated, as the stellar returns might continue to attract additional capital. It will be interesting to see if the currencies can hold onto their gains next week or even surge higher.

The strength of the Nasdaq or the weakness of the S&P 500 will dominate?

The relative strength of the US technology index was even more apparent this week, as the benchmark jumped to new all-time highs while the S&P 500 and the Dow remained below their respective maximums. These types of divergences usually don’t last too long, so or the broader market will join the party or bulls will be in for a painful hangover after the post-election euphoria.

Another round of crucial earnings coming up

So far first quarter earnings in the US were much better than expected, and what’s more, stocks reacted well to the positive surprises. Next week Apple, Facebook, Alibaba, Mastercard, and dozens of other companies will release their numbers possibly having a major impact on the market. Although corporate earnings are at a very high level historically, until the global economy keeps growing (thanks in part to the unprecedented central bank measures) there could still be room for growth.

Job’s Friday after the FED

This month’s US employment numbers could be even more crucial for investors than usual, as they will be released just after the Fed’s interest rate decision and monetary statement. As traders expect the central bank to reflect on the slowing growth in the country, another weak report could cause major turmoil before the weekend, especially if the FED turns more cautious. Initial jobless claims have been showing some worrying signs lately, and that might translate to a negative surprise in the coming report.

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In Focus: Cryptocurrencies

Weekly performance comparison of the major cryptocurrencies, Hourly Chart

The chart above shows just how strong this week was for the cryptocurrency market, as only Bitcoin advanced by slightly less than 10% since last Sunday, while all the other coins all posted double-digit gains. Ethereum Classic and Ripple rose by more than 80% and 55%, but Ethereum, NEM and Dash are also up significantly. With almost all currencies at or near their long-term highs, traders can choose from several strong trends in the segment. The structure of the market shift continuously, as Bitcoin’s weight is progressively decreasing, despite the new all-time highs in BTC. We are expecting another busy week for the segment, with Dash and Monero edging towards their long-term highs as well this weekend, possibly preparing to follow the explosive break-outs of the other majors.

Mate Cser

Trader and financial analyst, with 10 years of experience in the field. An expert in technical analysis and risk management, but also an avid practitioner of value investment and passive strategies, with a passion towards anything that is connected to the market.

Dmitriy Lavrov is a professional trader, technical analyst and money manager with 10 years of trading experience. He covers Forex, Commodities and Cryptocurrencies. He is among the top 10 most Read More

Jonas Borchgrevink

Founder

Jonas Borchgrevink is the founder of Hacked.com and CryptoCoinsNews.com. He is a serial entrepreneur, trader and investor. He shares his own personal journey on Hacked.com. // -- Discuss and ask Read More

P.H. Madore

ICO Analyst

P. H. Madore lives in Arkansas with his wife and children. He has covered the cryptocurrency beat over the course of hundreds of articles for Hacked’s sister site, CryptoCoinsNews, as Read More

Mate Csar

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Mati Greenspan

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Rakesh Upadhyay

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Pamela Meropiali is responsible for users on Hacked.com. // -- Discuss and ask questions in our community on Workplace. Don't have an account? Send Jonas Borchgrevink an email -- // Read More

Joseph Young

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Joseph Young is a finance and tech journalist & analyst based in Hong Kong. He has worked with leading media and news agencies in the technology and finance industries, offering Read More